UCP can’t tell others to get their fiscal house in order until they clean up their own.

You see those people pictured above?

They are NDP.

They are socialists. They have no concept of nor interest in balancing budgets. I expect little of them fiscally and they never fail to meet my expectations.

You see those people pictured above?

They are the Wildrose Party caucus (now UCP).

They are supposed to be conservatives. They are supposed to balance budgets. They are supposed to be efficient managers and capable stewards of the tax dollars entrusted to them by Albertans. I expect a great deal from these people. They have failed to meet my expectations.

UCP Caucus facing deficit.

Even with a newly merged conservative entity, we can’t assume that we will be able to displace the Notley Regime in the next general election.

I can almost guarantee you that we will not beat the NDP in an election if we can’t even keep a simple damned office budget balanced. How the hell are we supposed to tell people to tighten their belts when we make cuts when we wont tighten our own? How can we ask them to trust us when we wont lead by example?

Get your shit together guys.

We cant afford another term of the NDP.

Ranting further below.

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First conservative unity, next conservative policy.

This weekend, I hope and expect that the majority of conservative minded people in Alberta will find themselves united under one banner.

One thing that has fallen by the wayside in these singular times of unity battles has been any real specific policy directions. This had to happen as we really need to unite under general principles of conservatism such as small government and low taxes. If we get ourselves mired into specific policy items we could reignite internal divisions at a time when we really can’t afford to. Conservatives can unite under general principles, but we can nitpick ourselves to death over the individual policies.

Assuming that the forces of unity are successful this weekend, we will then enter a formal leadership race (it has already been clearly informally running for some time now).

There is no better time to hammer out policy specifics and commitments than during a leadership race and we dearly need to start spelling out what the plan is.

Yes, the vast majority of Albertans think that the NDP is harming our province. We do not have a specific plan laid out for how we will mitigate the damage caused by the NDP once we finally toss them to the electoral curb however.

Most candidates and supporters agree that the NDP carbon tax has to go. Notley has proven that legislative flagellation through tax hikes will never buy us that mythical “social license” required to get our products out of the province. The impact of the carbon tax on our environment is negligible at best and the impact on the economy is terrible.

In cutting taxes though, how do we balance the budget?

There is no getting around it. We need to cut spending and we need to cut it deeply. The longer the NDP is in power, the more painful the recovery will be but we simply can’t avoid it. Alberta spends $2,700 more annually per-capita than our neighbors in BC. We have plenty of room to cut.

One of the most effective ways that the left has undercut those calling for spending cuts so far has been for them simply to ask “where will you cut?”.  That is a perfectly valid question and it absolutely has to be answered.

Health care and education make up the vast majority of our spending. No matter how people feel that these areas are sacred, we simply must reduce how much we spend in those areas. We can’t afford a hospital on every street corner or a nurse’s visit to every household. While it will never feel like we spend enough in these core services, we have very real limits on what we can afford. We need to examine these areas and cut spending to a reasonable level.

Just proposing such cuts will take political courage. Following through on these cuts will take leadership and strength.

Klein was at his most popular while he cut Alberta’s spending by 20% across the board. Despite the howls of the unions and the left still harping about it today, it really wasn’t that bad when the cuts were happening. There clearly was a great deal of bloat within the civil service and we were all better for the trimming of it. “Infrastructure deficit” is a bullshit term that some use to try and knock the austerity of those times. Again it is trash and most Albertans see through it. There will never be enough schools, interchanges, fire stations etc. We can always use more. Tax dollars are finite though and we have to draw a line somewhere. Klein’s support began dropping significantly as soon as he began falling into the tired old PC pattern of spending our way out of problems. Albertans appreciate fiscal restraint when it is presented with good leadership.

Image ht to Roy Doonanco

Brian Jean has chosen to avoid taking any strong stance on cuts and is pursuing the mushy middle. This is not my idea of strong leadership but I guess it is a strategy. I can’t help but remember Jean’s abysmal debate performance where he almost mindlessly answered every question by stating that he wont raise taxes. He literally sounded like some sort of broken record. I remember all too clearly sitting in a room full of volunteers on one of the campaigns. We had put up a projector screen and bought some beer and pizza to give our volunteers a night off. We hoped that they would be invigorated in watching the debates. We found ourselves dejected. That was the night that I truly began to realize that we were not going to win that election. Notley showed energy and vision, Prentice showed classic arrogance and Jean was inanimate. We are paying so dearly for the lack of principled leadership in that debate today.

Maybe Jean will show some more strength after the unity vote is finished with. Perhaps other candidates will spur some vigor out of him. Maybe Jean’s strategy of avoiding strong stands will actually pay off and he will win the leadership. I personally don’t think so.

Assuming a successful unity vote, the leadership race will very likely be determining who our next premier will be.

It will take vision, leadership and a true plan with policy specifics in order to win that leadership.

I do look forward to seeing who emerges from the pack with the above qualities as the race unfolds. We need some real policy discussion and we need it soon.

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Health care “premiums” are a tax. Say it like it is.

To say that the Redford government is up the fiscal creek is an incredible understatement. The Redford led Progressive Conservative Party of Alberta won the 2012 election on a platform of false revenue projections and completely unsustainable spending promises that can only be called outright lies. Fiscal reality has come home to roost and Alberta is now facing a catastrophically large budgetary deficit.

Like rats from a sinking ship, Alison Redford’s communications staff are bailing out as they know that participating in the festival of lies demanded to try and polish Redford’s turd of a budget will only destroy any future hopes of work within the field of communications. The lack of communications strength was quite clear and visible in Alison Redford’s bizarre address to Albertans where she spit out blame and excuses for the disaster of her own making while really saying nothing else of merit. Even the Alison Redford’s twitter account appears to have been assigned to somebody with the communications skills of a six year old as petulant tweets attacking radio hosts are sent out.

Now that is has been pretty clearly established that Redford has reduced her communications staff to one of the most expensive yet simplistic groups in the nation, we can speculate on where they plan to go to try and dig their administration out of this embarrassing hole.

Redford has now claimed that she will not raise taxes despite the gargantuan deficit that she created. This leaves her in something of a quandary. A simplistic way to get around this of course is to label a tax something else. That is exactly what happens when we hear speech on health care “premiums” and predictably we are hearing rumblings that the health care tax may be reinstated.

The general health care tax that was mislabelled as a “premium” was one of Alberta’s most regressive and inefficient taxes ever. While the tax provided little burden to high income earners, it was quite onerous for people and families on fixed incomes. The health care tax was very difficult to administer and a very large portion of the generated revenue was lost through collections and administration.

The funds from the health care tax were never kept in a separate dedicated fund for health expenditures. The health care tax was indiscriminate of the payer’s own health or lifestyle. Healthy people and sick people paid the same “premium” and all revenues went into general revenues. That is why no matter how some try to say it, the health care tax is a tax and not a “premium” by any measure. Redford’s communication army should try something new through telling the truth for a change. Admit a tax increase for crying out loud. It’s not as if Albertans have not already concluded that Redford is full of bullshit. We won’t be fooled now.

Some claim that a health care tax helps teach Albertans the true cost of health care. Unless the health care tax is at least a few thousand dollars a year, that simply is not true. A few years ago, I encountered a somewhat informed lefty who was convinced that the monthly “premium” that he paid for health care accounted for his entire costs in health care.  The monthly payment actually added to confusion about the real cost of care in our socialised monopolistic health care system.

Perhaps bringing in a health care tax is a good idea or perhaps it is not. Let’s not cloak this in bullshit though and call it what it is; a tax increase and another broken Redford promise if it comes about.

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Government debt is nothing like a personal mortgage!

As the inept and increasingly corrupt Redford government marches Alberta back into debt, apologists are trying to say that government debt it a good thing and is like a mortgage. That statement is utter hogwash and it is tiring.

To begin with a mortgage is taken out by individuals (or families), to purchase what will likely be an appreciating asset. Equity (most likely) will build in the purchase that can be used to borrow against in the future in possible hard times or the home may simply be sold outright later. Barring either of the above, the home and it’s value will eventually be handed down to heirs.

Government capital projects while providing value are not typically transferable and only lead to future maintenance costs as opposed to appreciating in future value. Can we use a hospital as collateral in a future loan? Can we sell an overpass if we need extra cash? Increasing long-term value makes incurring debt for a home purchase a good idea. That growing value simply does not exist in government capital projects.

A mortgage is usually a once in a lifetime debt. People may move from home to home while building equity and transferring the mortgage but a person will generally only have one mortgage at any one time and the goal will be to pay it off. When government begins borrowing in good times as Redford plans to do now, it is akin to taking out a new mortgage every year. No appreciating asset is being purchased and debt simply keeps growing and growing. There is no equity offsetting the loan.

While a personal mortgage will eventually end, capital expenditures never will. There will always be more roads needed and hospitals demanded. Will future generations not need such expenditures too? They will have to pay for that infrastructure while paying debt off along with interest. Is this principled or fair?

We hear the dwindling Progressive Conservative supporters trying to paint things as if it is some sort of zero-sum game with idiotic questions such as: “Don’t you want schools, hospitals and roads?”. Of course we do and we will still have all of those damned things without borrowing to get them.

People keep speaking of an infrastructure deficit. By who’s measure is there a deficit? Is there ever enough hospitals? Will roads ever be wide enough? Will kids have enough schools close to home? Will there be enough libraries? The demand for spending is truly infinite. The capacity to spend is finite though and we have to draw a line somewhere.

If we need to borrow while the government is receiving record revenues as it is now, it is clear that there is no way that this administration will stop borrowing down the road no matter what energy prices do. We will borrow and borrow and borrow until an inevitable fiscal collapse that our children and grandchildren will have to endure.

All around the developed world we are seeing governments collapsing under their own debt. Most of Europe is in fiscal shambles and the USA is soon to either hit the wall or have some terribly heavy austerity measures come into place as their government debt overwhelms them. Why on earth do we want to continue to keep digging ourselves into that unsustainable hole when such clear examples of the futility of that path are in front of us?

We are lucky in Alberta to have the means for some of the best infrastructure and development in the entire world. For us to threaten this with such a gross addiction to spending and lazy government is almost obscene.

The excuses and rationalizations will be coming hard and heavy as the 2013 budget looms and Redford presents Albertans with a massive budgetary deficit. To be sure, the mortgage comparison with government borrowing is simply bunk. Be sure to remind Redford’s small social media army of that as they ramp up their unprincipled rhetoric in the next few months.

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What part of broke do they not understand?

It is happening all around the world including Canada, the only difference is in degree. Governments on all levels are spending more than they are bringing in and the inevitable financial collapses are beginning to occur.

Cowardly politicians and shallow electorates have repeatedly brought in policies and programs that are totally unsustainable and have done so through debt. Nowhere is this more acute right now than in Europe where they have reduced retirement ages, shortened work weeks and grossly increased social entitlements such as pensions and welfare to the point of complete fiscal unsustainability.

The productive have been taxed out of the nations and investment is avoiding the EU like the plague.

One by one we are watching these nations collapse as they pass reasonable debt thresholds.

The economic collapse of these nations is not all that shocking. Right or left, the concept is very simple and immutable: IF YOU SPEND MORE THAN YOU TAKE IN EVENTUALLY YOU WILL GO TOTALLY BROKE!

Despite what should be a stark and self-evident reality, entitlement has blinded the citizens of these countries. As the inevitable austerity budgets come down, union-led riots erupt as people flood into the streets to demand funds that simply no longer exist. We saw this last winter in Greece and now are seeing it in Spain as pictured below.

Hipsters Gone Wild! Spain edition!

 

 

People can scream, shout, riot, assault police, attack businesses and throw whatever tantrums they like, it will not change the hard reality that the cupboard is bare.

Do these rioters think that their government is hiding a big pile of resources from them? Do they think their local legislative building has a mountain of gold hidden within it? Whatever their delusion may be, rioting is futile and they would be better served seeking employment and pinching their pennies.

As I said earlier though, we are only better in degree. Our governments at the federal, provincial and municipal levels are all spending more than they are taking in and it has to end. Will we let it end in bankruptcy like our European neighbors or will we begin to cut spending responsibly now while it can still be on our terms? I fear the answer for that.

We need to cut spending people. This is not a matter of opinion, it is simple reality. Otherwise we will inevitably end up in Europe’s shoes. It will be even worse for us pride wise as we have no excuse in not seeing this coming.

 

 

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Taxpayers are squeezed enough! We have a spending problem.

 A few weeks ago I attended one of the Alberta Party’s big listens in Medicine Hat. It was a cold winter night and I figured that I may as well pop out and see what the Twitter crowd was up to. The tea-house that hosted the event was beautiful and the environment was welcoming for the 17 or so of us who showed up. The people in attendance whether with the Alberta Party or there to learn about the party all appeared to be earnest and seeking ways to improve the province.

 The “big listen” was an interesting excercise to say the least. We began with introductions and continued to circle the room with guests speaking about how they feel about things in what felt like some support group manner. We were asked to expand on what we felt grateful for and what we were optimistic about. It certainly was warm and fuzzy but there really were no conclusive policy discussions within the first hour. That is reflected in what the Alberta Party has hammered together for vague policies so far.  

 The views of the room became more evident in the later part of the meeting when people could speak more specifically to their concerns. One fellow was there because he felt that government was not spending enough for his pet project of a local library. Another person there was a representative of the teachers union who expressed that the government was not spending enough on education. There was a man in attendance who felt that government was not spending enough to preserve and set aside prairie land for protection of species and there was a couple from the “friends of medicare” who went on at length about how government has been starving healthcare.

  The gal from “friends of medicare” then launched into a tirade about how government has a revenue problem and we must further tax the rich and that energy companies are robbing Alberta blind. It was disconcerting seeing the heads nodding around the room during this rant worthy of Vladimir Lenin as people envisioned increased funding for their personal projects taken from some apparent faceless “rich people” and corporations. The simplistic Robin Hood call of taxing the evil rich unfortunately is an effective one for many people. It is unfortunate that is destroys economies when followed as we are seeing in Europe.

 All of the concerns expressed by the people in that room that night are valid ones and important ones. These were the concerns expressed with less than 20 Albertans when an open meeting is called. Imagine how many individual pet projects come up when a large townhall meeting is held. The Alberta Party meeting was a microcosm of a large townhall meeting. People with predetermined special interests show up and lobby MLAs furiously with funding demands for their projects. Due to this, we can see why the tired Progressive Conservative MLAs succumb to the temptation to simply promise money to all rather than take on the difficult task of governing with a sense of fiscal responsibility. This is reflected in our series of deficit budgets.

 Lets get some facts out there now.

Health spending in Alberta was $1,950 per-capita in 2001. This year it will be an estimated $6,266 per-capita. We have tripled per-capita healthcare spending in Alberta in less than ten years and we are spending the most in the entire nation. I must call B.S. on those claiming that we are underfunding healthcare in Alberta.

How about education? Well Alberta tops the nation in spending per-capita on education too.

http://policyschool.ucalgary.ca/files/publicpolicy/albsp2.pdf 

 The trend is consistent in virtually all departments of spending. Alberta is consistently near the top or at the top of spending when compared to every other province in Canada. How the hell can people keep claiming that we do not spend enough?
 
 Alberta spends the least (for now) in debt servicing per-capita. For those who truly care about program spending, how can you lobby for further deficit budgets that will lead us to wasting money on interest charges and debt servicing instead of spending on core programs? I can think of few worse ways to spend tax dollars.
 For those who feel we need to tax those nasty corporations by the way, I suggest that you do some research into who actually owns those corporations and where the profits go (here is a hint, it is your pension plan). RRSPs and pension plans by far make up the majority of corporate ownership in Canada so when you folks want to knock those big nasty businesses keep in mind that you are shooting directly at your own feet. Those corporations employ millions as well and when they get knocked with taxes they tend to lay folks off.
 Support for deficit/debt budgets comes only from people with a deep abiding special interest or people simply participating in intellectual/political sloth. Alberta brings in more than enough revenue from taxpayers. We need to work on the proper management of the funding that we already have.
There really is no excuse to expand spending beyond inflation and population growth. It is too bad that our government is too weak to acknowledge that and we will see that this afternoon when we are presented with the Ted Morton / Ed Stelmach deficit budget.

Authors of our 2011/2012 deficit budget.

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Hapless Ed is sure to express surprise again.

 stelmach03_103961artw

 Should Premier Eddie finally make an appearance to address the gross increase in our provincial deficit, I wonder which adjective he will use to describe this? I think in most Stelmach releases he has used all of these words so he must be familiar with them: unexpected, unanticipated, unpredicted, unforeseen, unheralded or perhaps he should simply go to unreal.

 The Herald is reporting on the frightening consequence of horrific fiscal management here.

 It is little wonder that Tom Olsen responds with blasts of obscenities when reporters dare ask direct questions of Stelmach. Being Stelmach’s handler must be one of the most challenging jobs on the planet. How much can you expose the man to the public when all he can do is express astonishment that yet another of his initiatives or predictions have blown up in his face? It must be disheartening in knowing that the best possible strategy to be taken in a by-election is to hide your leader as deeply as you can.

 Will Special Ed shed his cloak of invisibility and address the looming quarterly fiscal update? What marble-mouthed excuses will be used to try and justify the latest example of the Stelmach government’s gross fiscal mismanagement?

 Hmm let’s see, in one year Eddie has taken an $8 billion dollar surplus and turned it into what is looking like an $8 billion deficit. There are still three more quarters in this fiscal year for Ed to drive our grandchildren further into debt and a sadly don’t doubt he will. I wish I could express such surprise as Ed now and then.

 How much longer can we tolerate a premier that has not made a successful move since assuming power? What sort of confidence can we have in our provincial leadership when the leader can do nothing but express shock that his management has been a disaster?

 What is shocking about our situation? Ed massively increased spending and drove our primary industry from the province. A person with a Grade 3 education can figure out the math on that one and see that poverty is sure to follow. Perhaps the reason that Eddie has been in hiding lately is that he is taking some sort of remedial classes somewhere (I sure hope so).

 Well, I have said it before and I will say it again; SEND ED A MESSAGE!!

 Calgary Glenmore has the opportunity and expect that they will indeed send a message. The rest of the province should get to work to make that message final.

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Trying to polish a turd.

 Yes I think the saying about the futility of polishing a turd is quite appropriate as we see Iris Evans somehow managing to table a record deficit budget and telling us it is “a good news story”. Geeze Evans, I shudder to think what you would consider a bad news story. In light of the Progressive Conservative’s astoundingly terrible fiscal management, I suspect that Evans will have to disclose a bad news budget within a year.

 I had the opportunity to go to the legislature and watch this travesty of a budget in person yesterday. Rest assured, the turd looks no more shiny when observed in person.

 The first order of business in the legislature was to sheepishly table a new version of the “fiscal responsibility act”. The reason for this of course is that the current budget is illegal. Sadly, when government breaks the law, they simply re-write the law. Sheepish is really not enough, the members of the Progressive Conservative government should all hang their heads in shame.

 The PCs are trying to present this as a budget of restraint. They have reduced the increased spending to match that of population growth plus inflation. That spending model is what fiscally wise people have been telling government to follow for over a decade. Sadly Special Ed is a decade late in figuring it out. Last summer we were projecting a surplus of almost $9 billion. In less than a year we are facing going almost $5 billion into the hole.

 The government is patting itself on the back for the fiscal restraint being shown. Reducing an increase is not an example of fiscal restraint, reducing spending is!

irisa

 Yes Evans is gazing into a crystal ball. You see, part of the budget is pure speculation. While the government is already admitting that they are spending $4.7 billion more this year than they are earning, they are sort of quiet about there being another $2.2 billion in revenue required to make their spending commitments. Essentially the government is praying that oil will massively spike in price in the next few months. If this spike does not occur, the real deficit is close to $7 billion.

 How much faith can we have in the prognostication powers of the government? Well considering the idiots were off on their projected revenue by over $10 billion over a period of some eight months or so, I must say that I am not terribly confident.

 The issue is not too complex. Our problem is not a sagging world economy or low commodity prices (though that does not help), our problem is that the government has been spending money like drunken sailors for over a decade.

reduced

 

 It does not take an economist to look at the above image and realize that Alberta has been on a collision course with deficit for years. Many voices from the Taxpayers Federation to the Fraser Institute to the Canadian Federation for Independent Business have been pointing this trend out to Stelmach for years. Stelmach blindly and idiotically ignored those voices and continued to piss away the hardearned tax-dollars of Albertans.

 How must it feel for those PC MLAs who sat in the legislature in the 90s? Those MLAs who endured the complaints and pressures to spend as Alberta tightened her belt and ended deficit financing? How does it feel to go so swiftly and deeply back into deficit after all that work guys? I watched the PC seals in the legislature pounding their desks in applause as Evans tabled that document which will place the burden of payment on our children. Can you guys really sleep at night? Have you any shred of principle left?

 This is the sad outcome of a government that has been in power for almost 40 years. There is no principle, there is no vision. The government exists for the Progressive Conservative Party’s interests. The interests of Albertans were discarded years ago. There will be no healing for this sick administration. They are entrenched, visionless and parasitic. The government takes no path aside from what they view as the path of least resistance. In cowardice they have bent to every spending demand and we now are all paying the price.

 Alberta needs to sweep this lost government from the legislature. We are prone to doing that every few decades. It is clear that such a housecleaning is more than in order now.

 The Wildrose Alliance Party is promoting fiscal responsibility and is wisely planning for Alberta’s future. Meetings are being held across the province and growth in the party is unprecedented. Despite the fast growth of the WAP, it will still be a tough and uphill battle to unseat a government that feels they are in power by divine right. It cannot be stressed enough how much Albertan’s need to shed their traditional apathy and to get involved. People need to work to make change. The campaign for election 2012 must begin now if we are to make change in Alberta. Don’t wait for somebody else to do it, they will not.

 If things are left as they are, we will be leaving a sad and shameful legacy to future generations in this province. To have so much potential wasted is intolerable.

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